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Parliamentary Service Amendment (Parliamentary Budget Officer) Bill 2011

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2010-2011

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

Parliamentary Service Amendment

(Parliamentary Budget Officer) Bill 2011

 

 

 

 

 

 

Explanatory Memorandum

 

 

 

 

 

 

 

(Circulated with the authority of the Minister for Finance and Deregulation,

Senator the Hon Penny Wong)

 

 

 

 

 

 

 

 

 

 



 

TABLE OF CONTENTS

 

TABLE OF ABBREVIATIONS AND COMMON TERMS.......................... ii

I.      GENERAL OUTLINE................................................................................ 1

Main features of the Parliamentary Service Amendment (Parliamentary Budget Officer) Bill (No…) 2011................................................................................................... 1

Financial Impact Statement............................................................................ 2

II.    NOTES ON CLAUSES............................................................................... 3

Clause 1: Short title....................................................................................... 3

Clause 2: Commencement.............................................................................. 3

Clause 3: Schedules....................................................................................... 3

Schedule 1: Division 1- Amending the Parliamentary Service Act 1999......... 3

Schedule 1: Division 2 - Amending the Parliamentary Service Act 1999........ 4

Schedule 1: Division 3 - Amending the Parliamentary Service Act 1999........ 4

Schedule 2: Amending the Charter of Budget Honesty Act 1998 .... ................. 4

Schedule 3: Amending the Freedom of Information Act 1982......................... 4

Schedule 3: Amending the Remuneration Tribunal Act 1973.......................... 4

Schedule 3: Amending the Long Service Leave (Commonwealth Employees) Act 1976       4

III. NOTES ON SCHEDULE 1 - Amendment of the Parliamentary Service Act 1999                                                                                                                                     5

IV. NOTES ON SCHEDULE 2 - Amendment of the Charter of Budget Honesty Act 1998       16

V.    NOTES ON SCHEDULE 3 - Amendments of other Acts....................... 20

 



 

TABLE OF ABBREVIATIONS AND COMMON TERMS

 

Abbreviation or

common term

Full term or description

Authorised member

An “authorised member” means the Leader of a Parliamentary party or a member of a Parliamentary party authorised, in writing, by the Leader of the Parliamentary party.

Budget

The budget includes publications released under Parts 5, 6 and 7 of Schedule 1 of the Charter of Budget Honesty Act 1998 , including the annual Budget, the Mid-Year Economic and Fiscal Outlook, the Final Budget Outcome, the Intergenerational Report and the Pre-election Economic and Fiscal Outlook.

Caretaker period

For a general election, means the period starting when the House of Representatives expires or is dissolved, and ending when it is clear that the Government has been re-elected or, if there is a change of Government, when the new Government has been sworn in.

Commonwealth body

Commonwealth body means:

(a) an Agency within the meaning of the Financial Management and Accountability Act 1997 ; or

(b) the High Court of Australia; or

(c) a Commonwealth authority within the meaning of the Commonwealth Authorities and Companies Act 1997 ; or

(d) a Commonwealth company within the meaning of the Commonwealth Authorities and Companies Act 1997 .

Entrusted person

The Parliamentary Budget Officer or a Parliamentary Service employee assisting the Parliamentary Budget Officer or a person acting under the direction of the Parliamentary Budget Officer.

General election

General election means a general election of the members of the House of Representatives.

Independent member

During the caretaker period for a general election, means a person:

(a)     who is not a member of a Parliamentary party; and

(b)    who intends to be a candidate in the general election, or in a Senate election held on the same day as the general election, without the endorsement of a political party; and

(c)     who, immediately before the caretaker period, was a Senator or a Member of the House of Representatives because the person:

(i)                  had been elected to the Senate or the House of Representatives without the endorsement of a political party; or

(ii)                had been chosen or appointed to fill a casual vacancy to the Senate without the endorsement of a political party.

Item

An item of a Schedule of the PSA Bill.

JCPAA

The Joint Committee of Public Accounts and Audit provided for in the Public Accounts and Audit Committee Act 1951

Leader of a minority party

The Leader of a recognised non-Government party of at least 5 members, but does not include the Leader of the Opposition in the House of Representatives or in the Senate.

Officer

The holder of the office of Parliamentary Budget Officer established by this Act.

Parliamentary party

(a)     A political party with at least one member who is a member of the Parliament of the Commonwealth and

(b)    During a caretaker period for a general election—includes a political party at least one member of which was a member of the Parliament of the Commonwealth immediately before the caretaker period.

PBO

The Department of the Parliamentary Budget Office established by this Act.

PS Act

Parliamentary Service Act 1999 .

PSA Bill

Parliamentary Service Amendment (Parliamentary Budget Officer) Bill 2011 .



Parliamentary Service Amendment (Parliamentary Budget Officer) Bill 2011

 

I.            GENERAL OUTLINE

 

Main features of the Parliamentary Service Amendment (Parliamentary Budget Officer) Bill 2011

1.               The Parliamentary Service Amendment (Parliamentary Budget Officer) Bill 2011 (PSA Bill) would, if enacted, amend the Parliamentary Service Act 1999 , which governs the Parliamentary Departments, and other Acts to establish the Parliamentary Budget Office (PBO) and the position of the Parliamentary Budget Officer (the Officer), and the purpose, functions and governance of the PBO.

2.               Specifically, the PSA Bill would:

·                    Establish the PBO as a fourth Parliamentary Department, establish the Officer as an independent officer of the Parliament, and provide for the employment of PBO staff and the governance framework of the PBO;

·                    Establish the mandate of the PBO to inform the Parliament by providing independent and non-partisan analysis of the budget cycle, fiscal policy and the financial implications of proposals;

·                    Establish the functions of the PBO to respond to requests for policy costings and other requests relating to the budget, from Senators and Members of the House of Representatives, with responses able to be undertaken in a confidential manner upon request outside of the caretaker period, and in a manner consistent with the Charter of Budget Honesty Act 1998 (the Charter) during the caretaker period;

·                    Enable the Officer to enter into arrangements to access information from Australian Government agencies, consistent with other legislative requirements ;

·                    Establish the duties and authority of the Presiding Officers in regards to the PBO, including overseeing the operation and administration of the PBO; and

·                    Establish the duties and authority of the Joint Committee of Public Accounts and Audit (JCPAA) in relation to the PBO, including enabling the JCPAA to consider the operations and work plan of the PBO.

3.               The Bill would also amend several other Acts to enable the establishment of the PBO, namely:

·                    The Charter would be amended to extend the caretaker period in a manner consistent with the definition in the Guidelines on Caretaker Conventions to when a Government is sworn in following an election, clarify access to the election costing functions, minimise the duplication of policy costings, and update references within the Act;

·                    The Freedom of Information Act 1982 would be amended to include the PBO and the Officer as an exempt agency; and

·                    The Remuneration Tribunal Act 1973 and the Long Service Leave (Commonwealth Employees) Act 1976 would be amended to ensure that the Acts encompasses the position of the Officer.

4.               The PSA Bill forms an important element of broader parliamentary reforms, which will enhance the credibility and transparency of the Commonwealth’s already strong fiscal and budgetary frameworks.  These changes have been developed in collaboration with the relevant Ministers and their Departments, and with the Presiding Officers.

Financial Impact Statement

5.               The proposed amendments have no further impact to the underlying cash balance as funding of $24.9 million was allocated over 4 years to establish the PBO in the 2011-12 Budget.

 

 

 

 



II.         NOTES ON CLAUSES

 

Clause 1: Short title

6.               This clause provides that, should the PSA Bill be enacted, it may then be cited as the Parliamentary Service Amendment (Parliamentary Budget Officer) Act 2011 .

Clause 2: Commencement

7.               This clause provides that if the PSA Bill is passed:

·                  Clauses 1 to 3, and anything in this Act not elsewhere covered, will commence on the day that the PSA Bill receives Royal Assent; and

·                  Schedules 1, 2 and 3 will commence on a single day to be fixed by Proclamation.  If these Schedules do not commence within 6 months beginning on the day the PSA Bill receives the Royal Assent, they will commence on the day after the end of that six-month period.

Clause 3: Schedules

8.               This clause provides that each of the Acts, as specified in the Schedules to the PSA Bill, is to be amended or repealed as set out in the applicable items in that Schedule.  It also provides that any other item in a Schedule has effect according to its terms, which relates to provisions such as application provisions.

9.               Briefly, the Schedules in the PSA Bill would amend the following Acts:

·                  Schedule 1 would amend the Parliamentary Service Act 1999 (PS Act);

·                  Schedule 2 would amend the Charter of Budget Honesty Act 1998 (Charter); and

·                  Schedule 3 would amend:

o    the Freedom of Information Act 1982;

o    the Remuneration Tribunal Act 1973 ; and

o    the Long Service Leave (Commonwealth Employees) Act 1976 .

10.          The following provides an overview of the amendments proposed in Schedules 1 - 3 of the PSA Bill.  The information is provided in general terms, rather than by item number.  Parts III - V of this Explanatory Memorandum contain a detailed description of the items in each Schedule.

Schedule 1: Division 1: Amendment of the Parliamentary Service Act 1999

11.          Division 1 of Schedule 1 amends the Parliamentary Service Act 1999 (PS Act) to ensure that the PBO is not covered within the definition of a ‘Department’ within the PS Act.  This amendment is required as matters relating to the PBO are dealt with in Division 2 of Schedule 1 of the PS Act.

Schedule 1: Division 2: Amendment of the Parliamentary Service Act 1999

12.          Division 2 of Schedule 1 amends the PS Act to establish the PBO, its purpose and functions, the PBO’s access to information, oversight arrangements of the PBO and to outline the employment conditions and arrangements for the Officer.  This Division covers matters including the appointment, remuneration, leave, and resignation arrangements for the Officer.

Schedule 1: Division 3: Amendment of the Parliamentary Service Act 1999

13.          Division 3 of Schedule 1 amends the PS Act to include the requirement for the Officer to prepare an annual report, consistent with arrangements for the Clerks of the Senate and House of Representatives, and the Secretary of the Department of Parliamentary Services. 

Schedule 2: Amendment of the Charter of Budget Honesty Act 1998 ....

14.          Schedule 2 amends the Charter to amend the definition of “caretaker period” consistent with the definition in the Guidelines on Caretaker Conventions and to clarify the processes associated with the provision of policy costings during a caretaker period, including requests made before polling day and requests made on or after polling day.

Schedule 3: Amendment of the Freedom of Information Act 1982

15.          Schedule 3 amends the Freedom of Information Act 1982 by including the PBO and the Officer as an exempt agency under Division 1 of Part I of Schedule 2 of that Act.

Schedule 3: Amendment of the Remuneration Tribunal Act 1973

16.          Schedule 3 amends the Remuneration Tribunal Act 1973 to ensure that this Act encompasses the position of the Officer.

Schedule 3: Amendment of the Long Service Leave (Commonwealth Employees) Act 1976

17.          Finally, Schedule 3 amends the Long Service Leave (Commonwealth Employees) Act 1976 to ensure that this Act encompasses the position of the Officer.



III.      NOTES ON SCHEDULE 1 - Amendment of the Parliamentary Service Act 1999

 

 

18.          This Schedule amends the Parliamentary Service Act 1999 (PS Act) to provide for the appointment and functions of a Parliamentary Budget Officer (the Officer) and the establishment of a Parliamentary Budget Office (PBO).

Definitions

19.          Items 1 to 11 and 14 add the following new definitions to section 7 of the PS Act:

·         authorised member;

·         budget;

·         caretaker period;

·         Commonwealth body;

·         general election;

·         independent member;

·         Joint Committee of Public Accounts and Audit;

·         Parliamentary Budget Office;

·         Parliamentary Budget Officer;

·         Parliamentary party;

·         political party; and

·         Senate election.

20.          Items 12 and 13 amend the definition of Secretary in section 7 of the PS Act to include the Officer.

New Division 1 - Departments other than the Parliamentary Budget Office

21.          Item 15 inserts a new Division 1 in Part 7 of the PS Act to clarify that the PBO is not covered within the definition of a ‘Department’ within Division 1 of the PS Act.  Rather, matters relating to the PBO are dealt with in Division 2 of Schedule 1 of the PS Act.

Parliamentary Budget Office

22.          Item 16 inserts a new Division 2 in Part 7 of the PS Act to establish the PBO and the Officer.

 

 

 

New Division 2 - Parliamentary Budget Office

New Subdivision A - Establishment, functions etc

New section 64A - Department of the Parliamentary Budget Office

23.          New subsection 64A(1) establishes a new Department of the Parliament to be known as the Department of the Parliamentary Budget Office.  As the PBO is to be established as a Parliamentary Department under the PS Act, it will be subject to the Financial Management and Accountability Act 1997 .

24.          New section 64A(2) provides that the PBO consists of the Officer established under new section 64C, together with employees engaged under the PS Act who will assist the Officer.

New section 64B - Purpose of the Parliamentary Budget Office

25.          The over-arching purpose of the PBO, which is further articulated in the PBO functions in new section 64E, is to inform the Parliament by providing independent and non-partisan analysis of the budget cycle, fiscal policy and the financial implications of proposals.

New section 64C - Parliamentary Budget Officer

26.          New section 64C establishes the office of the Officer.  A note to this section provides that the Officer is the Secretary of the PBO.

New section 64D - Appropriation of Consolidated Revenue Fund

27.          To ensure the PBO has funding to commence operations in the 2011-12 financial year, new section 64D provides for a one-off departmental special appropriation of $6.0 million as allocated in the 2011-12 Budget.  After the 2011-12 financial year, ongoing funding for the PBO will be provided through the annual Parliamentary Department Appropriation Acts.

New section 64E - Functions of Parliamentary Budget Officer

28.          New section 64E establishes the various functions of the PBO, consistent with the PBO’s over-arching purpose outlined in new section 64B.

29.          The functions include producing, on request:

·         policy costings of Senators or Members of the House of Representatives, outside of the caretaker period; and

·         election policy costings of authorised members of Parliamentary parties, or for independent members, for publicly-released policies during the caretaker period.

30.          The functions also extend to:

·         the preparation of submissions to Parliamentary committees on request by a committee;

·         the preparation of responses to requests relating to the budget (other than policy costings); and

·         conducting research and analysis of the budget and fiscal policy settings on the Officer’s own initiative in anticipation of client interests. 

31.          New subsection 64E(2) specifies that the PBO’s functions do not include preparing economic forecasts and preparing budget estimates (whether at the whole-of-government, agency or program level), other than the budget estimates for the PBO.

32.          The PBO will be required to use the official economic forecasts and parameters and fiscal estimates produced by the Government under the Charter of Budget Honesty Act 1998 (the Charter) as outlined in new subsection 64E(3).  This does not preclude the PBO from analysing the Government’s estimates.

33.          New subsection 64E(4) requires that the Officer must only perform the functions outlined in new section 64E for the purpose of the PBO outlined in new section 64B.

New section 64F - Arrangements for obtaining information from Commonwealth bodies

34.          In order for the PBO to fulfil its mandate effectively, it is likely to require access to certain information held by Commonwealth bodies.  New section 64F enables the Officer to establish arrangements, to typically take the form of memoranda of understanding (MOU), with the Head of a Commonwealth body (or a person authorised by the Head) to obtain information and documents from the body, necessary for the Officer to carry out the functions of the PBO.

35.          In the interests of efficiency and consistency, it is envisaged that an MOU will initially be developed with the Departments of Finance and Deregulation (Finance) and the Treasury (Treasury) and that other agencies would use this agreement as necessary.

36.          An MOU would typically set out a framework for the exchange of data and information between the PBO and agencies, including arrangements relating to the use and disclosure of that information.  It may also outline the standard processes the PBO would follow in submitting requests and the scope and types of data, models and other information that may be made available.  Additionally, it may outline the processes for the review of the working arrangements under the MOU and for seeking amendments to the MOU.

37.          The MOU may also outline the basis for discussion on matters including the data, assumptions, issues and background information relevant to particular policies or programs where necessary. The costing protocols and guidelines provided for in new section 64G would govern the use and presentation of this data and information in both confidential and publicly released policy costings.

38.          The MOU may also outline the grounds on which agencies can refuse access to information, which could include the same grounds that documents can be exempted from requests under the Freedom of Information Act 1982 and other relevant legislation.  The MOU would offer options for recourse by the Officer should the requested information not be provided.

39.          New subsection 64F(3) requires any arrangements (such as an MOU) made under new subsection 64F(1) to be made publicly available.  Further, new subsection 64F(2) provides that an arrangement may make provision for the confidentiality of information disclosed or documents provided under that arrangement.

40.          Arrangements made under subsection 64F(1) are not legislative instruments as they are not legislative in character and therefore not within the meaning of section 5 of the Legislative Instruments Act 2003 (LI Act).  New subsection 64F(4) confirms this and is included to assist readers.

New section 64G - Approaches etc to be used in preparing policy costings etc

41.          New subsection 64G(1) provides that the Officer may, with the agreement of the Secretaries of Finance and Treasury, issue written principles that the Officer will use to undertake policy costings.  These principles will canvass approaches to costings and certain conventions and protocols that will be used, both during caretaker and the non-caretaker period (if different).

42.          If no principles are in effect under new subsection 64G(1) the Officer is to prepare policy costings using the approaches and costing conventions recommended in the most recent guidelines issued under subclause 30(1) of the Charter.

43.          New subsection 64G(3) requires the Officer to make the principles prepared under this clause publicly available.

44.          Consistent with the treatment of election costing guidelines issued by the Secretaries of Finance and Treasury under the Charter, the written principles issued under subsection 64G(1) are not legislative instruments as they are not legislative in character and therefore not within the meaning of section 5 of the LI Act.  New subsection 64G(4) confirms this and is included to assist readers.

New section 64H - Requests for costing of policies outside caretaker period

45.          New section 64H governs the approach for the request of policy costings by Senators or members of the House of Representatives during the non-caretaker period. The “caretaker period” is based on the definition in the Charter as amended by item 4 of Schedule 2 of the PSA Bill.  Item 4 of Schedule 2 provides that, for a general election, it is the period starting when the House of Representatives expires or is dissolved, and ending when it is clear that the Government has been re-elected or, if there is a change of Government, when the new Government has been sworn in.

46.          New subsection 64H(2) enables any Senator or member of the House of Representatives, regardless of party status, to request the Officer to prepare a costing of a policy or a proposed policy.  New subsection 64H(3) requires the request is made in writing, and is outlined in detail. This includes providing relevant information on the purpose or intention of the policy.  The request may also include a direction that the request and the policy costing are to be treated as confidential.  The note following subsection 64H(3) provides that new subsection 64V(2) should be referred to in relation to confidentiality obligations.   

47.          If required, new subsection 64H(4) enables the Officer to seek further information from the requestor, in writing, in order to undertake a policy costing.

48.          Under new subsection 64H(5) a request may be withdrawn at any time, provided it is made in writing by the Senator or the member of the House of Representatives who made the request. 

49.          If the Officer does not have sufficient information or time to prepare a policy costing before an election, new subsection 64H(6) provides that the request lapses and is taken to be withdrawn immediately before the start of the caretaker period.  In such cases, the request would need to be re-submitted under new section 64J.

New section 64J - Requests for costing of policies during caretaker period

50.          New section 64J governs the approach for the request of policy costings during the caretaker period.

51.          New subsection 64J(2) provides that policy costings during the caretaker period can only be requested by authorised members of the Parliamentary party for publicly-announced policies of that Parliamentary party.  

52.          New subsections 64J(3) and (4) specify that a request for a policy costing may not be made to the PBO if a same, or a substantially similar, policy has already been made to Finance or Treasury under the Charter.  That is, a costing request can only be made to one of these organisations.

53.          New subsection 64J(5) enables independent members of Parliament to also request policy costings during the caretaker period of publicly-announced policies of that independent member.

54.          Similar to the process outlined for 64H(3), new subsection 64J(6) requires all requests during the caretaker period to be made in writing, and to outline fully the policy to be costed, as well as the purpose or intention of the policy.  New subsection 64J(7) enables the Officer to seek further information, in writing, in order to undertake a policy costing.

55.          New subsections 64J(8) and (9) enable a request for a policy costing by a Parliamentary party under this section to be withdrawn provided the request is in writing by an authorised member on behalf of the Parliamentary party, or an independent member who made the request.

New section 64K - Caretaker period policy costing requests—interactions with the Charter of Budget Honesty Act 1998

56.          New section 64K provides that if a request to the Officer for a costing during the caretaker period is made under new section 64J(2) by a Leader of a Parliamentary party (or a member of a Parliamentary party authorised in writing by the Leader), then the Officer must ask the Secretaries of Finance and Treasury whether that same policy or substantially similar policy has already been requested under clause 29 of Schedule 1 to the Charter.

57.          If such a request has already been made under the Charter, new subsection 64K requires that the Officer must not prepare a costing of that policy for the Parliamentary party.  This means that a single Parliamentary party will not be able to request a costing of the same policy, or a substantially similar policy, from both the Officer and the Secretaries of Finance and Treasury under the Charter.  That is, the party may only request the policy costing from one of these organisations.  This is intended to preclude parties from seeking duplicate costings from different sources.

New section 64L - Caretaker period policy costing requests made before polling day—public release of requests and costings

58.          New subsection 64L(2) provides for the public release of a request and a policy costing undertaken by the Officer during a caretaker period.  As soon as practicable after a policy costing request has been made, and before polling day for the election, the Officer is required to release publicly the request and the policy costing.

59.          New subsection 64L(3) provides that where a policy costing request has been made during the caretaker period, but the Officer did not have sufficient information, or time to prepare and publicly release the policy costing, the Officer must publicly release a statement indicating this, prior to polling day.  The effect of this is that the request is deemed to have been withdrawn.  Where a policy costing request is deemed to have been withdrawn but the caretaker period for that general election then extends beyond polling day, the Officer is not obliged or authorised to take any further action in relation to that request. 

60.          If a Parliamentary party or an Independent member still wants the costing to be prepared they will be required to re-submit the costing request to either the PBO, or pursuant to the Charter, so that the costing may be completed and publicly released after polling day, or by the end of the caretaker period.

New section 64LA - Caretaker period policy costing requests made on or after polling day—public release of requests and costings

61.          New section 64LA is designed to operate where the caretaker period for a general election extends beyond the polling day for a general election.   It outlines the arrangements for such occasions and recognises that, on such occasions, it will be necessary to distinguish between pre- and post-polling day costing requests.  This section outlines the process that the Officer must follow in responding to policy costing requests.

62.          The provisions relating to post-polling day costing requests mirror those relating to pre-polling day requests in that, as soon as practicable after the request has been made, the Officer is to prepare and publicly release the request and a costing of that policy.

63.          Costing requests made after polling day could relate to requests that were deemed to have been withdrawn on polling day and have subsequently been re-submitted, or they could be new costing requests that have not previously been submitted in the caretaker period.  A withdrawn request could be re-submitted either under the PS Act or the Charter.

64.          Where a policy costing request is deemed to have been withdrawn and the caretaker period for that general election extends beyond the polling day, the Officer will not be obliged or authorised to take any further action in relation to that request.  A Parliamentary party or Independent member will be required to re-submit the costing request to either the PBO, or pursuant to the Charter, so that the costing may be completed and publicly released after polling day, or the end of the caretaker period.

New section 64M - Requests relating to the budget (other than requests for policy costings)

65.          New section 64M provides that a Senator or Member of the House of Representatives may direct that their request under new subsection 64E(1)(c) is treated in a confidential manner.  The confidentiality applies to the original request for work, the response to the request, and any other substantial information in relation to the request.  This section reflects the importance of impartiality and confidentiality to meeting the needs of Senators and Members.

New section 64N - Responsibility for managing Parliamentary Budget Office

66.          New section 64N outlines the role of the Officer in managing the PBO.  The position of the Officer has been established as an independent officer of the Parliament and the Secretary of the PBO.  All relevant functions associated with the administration of the PBO as a Parliamentary Department under the PS Act are the responsibility of the Officer, who must advise the Presiding Officers in relation to the operation and administration of the PBO.  This includes the preparation of an annual work plan, workload protocols, and an operating budget.

67.          New subsection 64N(2) outlines the responsibilities of the Officer to assist the Presiding Officers to fulfil the Presiding Officers’ accountability obligations to the Parliament and provide factual information, as required by the Parliament, in relation to the operation and administration of the PBO.

New section 64P - Restrictions on directions to Parliamentary Budget Officer

68.          The Officer has responsibility for a range of discrete functions related to the provision of policy costings, analysis and advice to Senators or Members of the House of Representatives.  The Officer is responsible for undertaking work in relation to these discrete functions in an independent manner.  New section 64P clarifies that while the Officer is to provide factual information on operational and administrative matters relating to the PBO, the Officer is not subject to the direction of the Presiding Officers on the performance and management of their specific functions.

 

 

New section 64Q - Annual work plan for Parliamentary Budget Office

69.          New subsection 64Q(1) requires the Officer to prepare an annual work plan which outlines the work priorities to be executed by the PBO to accomplish its objectives and achieve the required deliverables.  As such, the work plan is to provide a framework for the PBO to attain each strategic goal and it should include methods to verify and evaluate the actual implementation of the work to be done.  The work plan is to be prepared in consultation with the JCPAA.

70.          New subsection 64Q(2) requires the annual work plan to be prepared within three months of the commencement of each new financial year.  In the first instance, however, the work plan is to be prepared within three months of the appointment of the Officer.

71.          The work plan should set out the priorities of the PBO and link the strategic objectives to daily operations.  It should present a realistic view of the scope of work to be undertaken through linking planned actions to available resources.  The work plan is to include an appropriate level of detail to guide the work, but not so much that it is unnecessarily constraining.

72.          The work plan prepared under new subsection 64Q(1) is not a legislative instrument as it is not legislative in character and therefore not within the meaning of section 5 of the LI Act .  New subsection 64Q(5) confirms this and is included to assist readers .

New section 64R - Joint Committee of Public Accounts and Audit may request draft estimates

73.          New section 64R provides the JCPAA with discretion to request that the Officer provide draft budget estimates for the PBO, prior to the finalisation of the budget for that financial year.  This is provided to facilitate the role of the JCPAA in overseeing the operation and resourcing of the PBO.

New section 64S - Duties of Joint Committee of Public Accounts and Audit

74.          New subsection 64S(1) outlines the role of the JCPAA in regard to the role and function of the PBO.  The JCPAA is responsible for reporting to both Houses of Parliament, and to the Presiding Officers, on a range of matters related to the general management and functioning of the PBO.  This includes reviewing the annual work plan and budget, and having an oversight role on resourcing matters related to funding, staffing and information technology.  The JCPAA also has discretion to report to Parliament on any other matter related to the power and function of the PBO that it considers relevant.

75.          New subsection 64S(2) clarifies that the JCPAA does not have the power to direct the activities of the Officer.

New section 64T - Review of operations of Parliamentary Budget Office

76.          New section 64T enables the JCPAA to request the Officer to cause an independent review of the PBO to be conducted.  The review must be completed within nine months after the end of the caretaker period of each federal election.  Both the JCPAA and the Officer have responsibilities related to the review activity.  The request by the JCPAA must specify the person or body conducting the review, and the scope and manner of the review.

77.          New subsection 64T(5) requires the review to be provided to the JCPAA once completed and tabled in Parliament as soon as practicable thereafter.

New section 64U - Public release of policy costings etc.

78.          New section 64U outlines the information and documents that are to be made publicly available by the Officer. This information includes requests for policy costings and other non-policy costing requests that relates to the budget (including any subsequent withdrawals of those requests) and responses to such requests where this has not been requested to be kept confidential, and the results of any other work done by the Officer.

New section 64V - Confidentiality

79.          New section 64V makes provision for circumstances in which the Officer must maintain the confidentiality of certain information that is held and/or produced by the PBO, or that is provided to the Officer by a Commonwealth body under the terms of an arrangement under new section 64F.

80.          New subsections 64V(1) and (2) apply this confidentiality requirement to the Officer, or anyone assisting or acting under the direction or authority of the Officer (“entrusted person”). 

81.          An entrusted person must not disclose information (publicly or to any third party) relating to a request made of the Officer for a policy costing outside of a caretaker period, or a non-policy costing request that relates to the budget, if the Senator or Member of Parliament has specifically requested confidentiality at the time of submitting the request (new sections 64H(3)(d) and 64M refer).

82.          This provision is necessary to give effect to the principle that Senators and Members of Parliament should be able to seek confidential advice from the PBO, including in relation to policy costings during non-caretaker periods.

83.          The confidentiality provisions will not prevent an entrusted person from disclosing some or all of the details of a request if disclosure is necessary in order to clarify a matter made in relation to a confidential request that was subsequently made public by someone other than an entrusted person.

84.          Despite the confidentiality requirement contained in new subsection 64V(2), the Officer is empowered by new subsection 64V(4) to make a public statement to clarify a matter relating to a confidential request, where the Officer considers it necessary in the public interest to do so. 

85.          New subsection 64V(4) operates subject to new subsection 64V(5) which provides that an entrusted person must not disclose information received by the Officer in accordance with an arrangement under new subsection 64F if the disclosure of the information would contravene a confidentiality provision in the arrangement.

New Subdivision B: Parliamentary Budget Office’s appointment, conditions etc.

New section 64X - Appointment of Parliamentary Budget Officer

86.          New subsections 64X(1) and (2) provide for the Officer to be appointed by the Presiding Officers on a full-time basis for a term of four years.  The Officer is eligible to be reappointed for one further four-year term only (64X(4)).  Importantly, new section 64XA provides that such an appointment cannot be made unless the JCPAA has approved the appointment. 

New section 64XA - Approval of appointment by the Joint Committee of Public Accounts and Audit

87.          New subsection 64XA(1) provides that the Presiding Officers must not appoint a person to the position of the Officer unless the proposed appointment has been referred to the JCPAA and approved by that Committee.  This requirement reflects the oversight role that the JCPAA is to have over the PBO.  

88.          New subsection 64XA(2) requires such a referral to be made in writing and may be withdrawn by the Presiding Officers at any time. 

89.          New subsection 64XA(3) requires the JCPAA to approve or reject the proposed appointment within 14 days of receiving it.  If the JCPAA requires more time, the Presiding Officers must be notified and may be asked to provide further information (new subsection 64XA(4)).  If the JCPAA does so, new subsections 64XA(5) and (6) provide the JCPAA, by majority, must approve or reject the proposal within 44 days of first receiving the proposed appointment.  New subsection 64XA(7) provides that if a decision is not made within 44 days, the JCPAA is taken to have approved the appointment.

90.          Once the JCPAA has made a decision in relation to the proposed appointment, new subsections 64XA(8) and (9) require the JCPAA to notify the Presiding Officers in writing as soon as practicable.  New subsection 64XA(10) also requires the JCPAA to report its decision to both Houses of Parliament.

New section 64XB - Remuneration of Parliamentary Budget Officer

91.          New subsection 64XB(1) provides for the Remuneration Tribunal to determine the  remuneration for the Officer.  If no determination of the Remuneration Tribunal is in operation, new subsection 64XB(1) also allows for the Presiding Officers to determine the remuneration of the Officer. 

92.          It is intended that in making such a determination, the Presiding Officers shall seek the advice of the Remuneration Tribunal if possible. The Presiding Officers are also to determine the allowances of the Officer (new subsection 64XB(2). 

93.          New subsection 64XB(3) provides that new section 64XB has effect subject to the Remuneration Tribunal Act 1973 .   

94.          New subsection 64XB(4) provides that determinations made by the Presiding Officers under this section are to be published in the Gazette within 14 days and to be laid before each House of Parliament as soon as practicable after it is made.

New section 64XC - Leave of absence

95.          New subsection 64XC(1) provides that leave entitlements of the Officer will be determined by the Remuneration Tribunal.

96.          New subsection 64XC(2) provides that the Presiding Officers may grant leave of absence, other than recreation leave, as they determine.

New section 64XD - Resignation

97.          New section 64XD establishes the procedure for the Officer to resign.

New section 64XE - Removal from Office

98.          New section 64XE deals with the removal from office of the Officer by the Presiding Officers.  This new section is consistent with the grounds for terminating the appointment of the Auditor-General under the Auditor-General Act 1997 .

New section 64XF - Acting appointments

99.          New section 64XF permits the Presiding Officers to appoint a person to act as the Officer during vacancy or absences.

Annual Reports

New Division 3: Annual report

100.     Item 17 inserts a new heading in Part 7 of the PS Act, to group the existing provisions on annual reports in a new Division 3.

Security Management Board

101.     Item 18 amends subsection 65A(2) of the PS Act to provide that the Security Management Board is to include the Officer, or an SES employee of the PBO nominated by the Presiding Officers in writing.

IV.      NOTES ON SCHEDULE 2 - Amendment of the Charter of Budget Honesty Act 1998

 

102.     This Schedule amends Schedule 1 of the Charter of Budget Honesty Act 1998 (the Charter).

Minor Technical Amendments

103.     Schedule 2 includes a number of technical amendments to the Charter to ensure the terminology in the Act reflects the new or revised terminology in the PSA Bill.

104.     Items 1, 3, 11, 12, 13, 18, 27 and 29 make minor amendments to ensure consistent references to the “Secretary of the Treasury” and “Secretary of Finance” through the Charter.

105.     Items 5, 7, 8, 9 and 10 add the following new definitions to subclause 3(1) of the Charter:

·         Department of Finance;

·         Member;

·         Minister for Finance;

·         Parliamentary Budget Officer; and

·         Parliamentary party.

106.     Items 17 and 16, respectively, repeal subclause 26(a)(v) of the Charter, which erroneously refers to subclause 24(1)(e), which does not exist, and updates subclause 26(a)(iv) as a result of this repeal.

107.     Item 21 repeals subclause 26(b)(iii) of the Charter, which erroneously refers to subclause 21(1)(e), which does not exist, and substitutes a revised subclause.

108.     Item 33 repeals the heading of clause 32 and substitutes a revised heading.

Definition of caretaker period

109.     Item 4 repeals and replaces the definition of ‘caretaker period’ in subclause 3(1) of the Charter to provide that the caretaker period for a general election begins when the House of Representatives expires or is dissolved ahead of that election, and ends when it is clear that the Government has been re-elected or, if there is a change of Government, when the new Government has been sworn in.

110.     Currently, the caretaker period is defined as beginning with the issue of the writ for a general election and ending at the close of the poll on the polling day for an election.  The revised definition will ensure that the definition of caretaker period in the Charter is consistent with the definition in the Guidelines on Caretaker Conventions published by the Department of the Prime Minister and Cabinet.

 

 

Definition of Leader of minority party

111.     Item 6 adds a definition of “Leader of a minority party” to be the Leader of a recognised non-Government party of at least five members (defined as a member of either House of Parliament), but not including the Leader of the Opposition.

Division of responsibility between responsible Secretaries

112.     Items 14 and 15 make a small, but significant, amendment to subclauses 26(a)(i) and 26(a)(iii) of the Charter to clarify that the Secretary of the Department of the Treasury (Treasury) is responsible for, in preparing a pre-election and fiscal outlook report under clause 24 of the Charter, information and risks relating to tax revenue and tax expenditures.

113.     Items 19 and 20 make a corresponding amendment to subclauses 26(b)(i) and 26(b)(ii) of the Charter to clarify that the Secretary of the Department of Finance and Deregulation (Finance) is responsible for, in preparing a pre-election and fiscal outlook report under clause 24 of the Charter, information and risks relating to outlays, expenses and non-tax revenue estimates.

How policy costings are to be prepared

114.     Items 28 and 30 amend subclause 30(2) of the Charter to reflect the division of responsibilities between the Secretaries of Finance and Treasury as outlined by items 14-15 and 19-20.

Ability for Leader of a minority party to access election costings provisions

115.     Items 2 and 22 amend subclause 2(6) and subclause 29(1) of the Charter to provide for the Leader of a minority party to request the Secretaries of Finance and Treasury to prepare costings of the publicly-announced policies of that minority party.  Parties with less than five members in either House of Parliament and independent members of Parliament will only have access to the election costing provisions by the PBO. 

116.     Items 24 and 25 and 26 amend subclauses 29(4) and 29(5) of the Charter to extend its provisions to the Leader of a minority party, in addition to the Leader of the Opposition.  The effect of this amendment is that the Leader of a minority party may request the responsible Secretaries to prepare costings of publicly-announced policies of that minority party, under the Charter procedures, whereby the request is submitted to the Prime Minister, who may then agree to refer it to the responsible Secretaries.  The responsible Secretaries are not obliged or authorised to take any action in relation to the request unless the Prime Minister has referred the request to them.

117.     Item 31 amends subclause 30(3) of the Charter to provide that the Secretary of Treasury or Finance may seek further information from the Leader of a minority party in relation to their costing request.

 

Prevention of duplicate costings

118.     Item 23 adds new subclauses 29(1A) and 29(1B), which preclude a Parliamentary party that has already requested an election policy costing from the PBO to then make a request under subclause 29(1) of the Charter, for the same policy, or a substantially similar policy, during the same caretaker period.  Item 22 also provides for a note to be added to subclause 29(1) precluding the Officer from preparing a costing of a policy that has already been requested under this clause.

119.     This means that a single Parliamentary party will not be able to request a costing of the same policy, or a substantially similar policy, from both the Officer and the Secretaries of Treasury or Finance; that is, the party may only request the policy costing from one of these organisations.  This is intended to preclude parties from seeking duplicate costings from different sources.

Public release of requests and costings - requests made before polling day

120.     Item 32 repeals clause 31 of the Charter and inserts a revised clause to distinguish between the different requirements for public release that will now apply to policy costing requests that are made before polling day for a general election and requests that are made on or after polling day during the caretaker period.

121.     Clause 31 only relates to policy costing requests that are made before polling day for a general election.  This clause incorporates the provisions currently outlined in subclauses 31(2) and (3), with the additional provision that a policy costing that was requested before polling day for a general election, but for which the responsible Secretary has not had sufficient time or information to prepare and publicly release the policy costing before the polling day, is deemed to have been withdrawn on that day (that is, polling day).

122.     Where policy costing requests are deemed to have been withdrawn and the caretaker period for that general election extends beyond the polling day, parties will be required to re-submit the costing request to either the Officer or under the Charter, so that the costing may be completed and released after polling day.

Public release of requests and costings - requests made on or after polling day

123.     Item 32 also provides for a new clause 31A, which applies to policy costing requests that are made after the polling day for a general election, in circumstances where the caretaker period for a general election continues beyond polling day.

124.     This amendment is necessary to provide for those occasions where the caretaker period for a general election extends beyond polling day for a general election and recognises that, on such occasions, it will be necessary to distinguish between pre- and post-polling day costing requests and to establish processes that the responsible Secretaries must follow in responding to these requests.

125.     The provisions relating to post-polling day costing requests will be similar to those relating to pre-polling day requests in that, as soon as practicable after the request has been made, the responsible Secretary is to prepare and publicly release a costing of that policy.

126.     Should the responsible Secretary have insufficient information or time to prepare and publicly release the policy costing before the end of the caretaker period, then they will be required to release a statement to that effect as soon as practicable after the end of the caretaker period.  In addition, the costing request will be deemed to have been withdrawn at the end of that caretaker period, and the responsible Secretary will not be obliged or authorised to take any further action in relation to the request under the Charter.

127.     Costing requests made after polling day could relate to requests that were deemed to have been withdrawn on polling day and are subsequently re-submitted, or they could be new costing requests that have not previously been submitted in that caretaker period.

 

 

 



 

V.        NOTES ON SCHEDULE 3: Amendments of other Acts

1.            Items 1 to 3 amend the Freedom of Information Act 1982 by including the PBO and the Officer as an exempt agency under Division 1 of Part I of Schedule 2 of that Act.

2.            Item 4 amends the Long Service Leave (Commonwealth Employees) Act 1976 to ensure that this Act encompasses the position of the Officer.

3.            Item 5 amends the Remuneration Tribunal Act 1973 to ensure that this Act encompasses the position of the Officer.